Julian Assange at the embassy in May last year.
Photograph: Martin Godwin/The Guardian

Ecuador’s foreign minister has said Julian Assange’s five-and-a-half-year stay in her country’s London embassy is “untenable” and should be ended through international mediation.

The WikiLeaks founder has been holed up in Knightsbridge since the summer of 2012, when he faced the prospect of extradition to Sweden over claims that he sexually assaulted two women. He denies the accusations.

Swedish prosecutors last year unexpectedly dropped their investigation into the allegations, which included a claim of rape. But Assange still faces arrest for breaching bail conditions if he steps outside the embassy and WikiLeaks has voiced fears that the US will seek his extradition and that there is a sealed indictment ordering his arrest.

WikiLeaks’ publications have included hundreds of thousands of US army war logs and state department diplomatic cables and more recently emails from the Democratic National Committee during the run-up to the 2016 US presidential election. The US attorney general, Jeff Sessions, said last May that Assange’s arrest was now a “priority”.

Ecuador’s foreign minister, María Fernanda Espinosa, said her country was now seeking a “third country or a personality” to mediate a final settlement with the UK to resolve the impasse and said it was “considering and exploring the possibility of mediation”.

“No solution will be achieved without international cooperation and the cooperation of the United Kingdom, which has also shown interest in seeking a way out,” she told foreign correspondents in Quito, according to Agence France-Presse.

Assange, who has received numerous visitors to his modest quarters in the embassy, ranging from Nigel Farage to Lady Gaga, has described the period since his initial arrest as a “terrible injustice”. Not being able to see his children grow up was “not something I can forgive”, he said.

For several years, Metropolitan police officers maintained a constant watch of the embassy, which is situated behind Harrods in central London, at a cost of at least £11.1m, according to figures released by Scotland Yard in June 2015. Four months later, police lifted the round-the-clock guard on the basis it was no longer proportionate.

A United Nations panel concluded in 2016 that Assange was under arbitrary detention.

On Tuesday evening, a lawyer for Assange appeared to welcome Ecuador’s proposal. He said his client had a right to asylum and argued that the risk of him being persecuted in the US had “escalated further in recent months under the Trump administration’s war on WikiLeaks” and that the investigation in Sweden had twice been discontinued.

“If the UK wishes to show that it is a nation that respects its human rights obligations and commitments to the United Nations, it is time for Mr Assange to be allowed to enjoy his right to liberty, and fundamental right to protection against persecution in the United States,” she said.

A spokesperson for the UK government said: “The government of Ecuador knows that the way to resolve this issue is for Julian Assange to leave the embassy to face justice.”